Good Ol’ Days of Free Trade

"Obama graciously concedes that 'not every American job lost is due to trade'. Not every job? The true figure – according to the apolitical US Council of Economic Advisors – is that only 3% of US job losses can be attributed to 'outsourcing'."

--Dominic Lawson, The Independent (London)

Lawrence Summers, the former Clinton treasury secretary and un-PC Harvard president, is now preparing us for the end of free trade as we know it. Summers says America will find it “increasingly difficult to mobilize support for economic internationalism;” i.e., Democrats like Obama won’t have it.

Summers makes three points:

1. Developing countries increasingly export goods such as computers that the US produces on a significant scale, putting pressure on wages. At the same time, rising global prosperity increases the rewards accruing to the already [wealthy] such as [filmmakers], where the US has a comparative advantage.

2. The growth of countries such as China raises competition for energy and environmental resources, raising the price for [average] Americans.

3. Growth in the global economy encourages the development of stateless elites whose allegiance is to global economic success and their own prosperity rather than the interests of the nation where they are headquartered.

Summers says the “stateless elites,” operating in the pursuit of global economic improvements, oppose “progressive taxation, support for labor unions, strong regulation and substantial production of public goods that mitigate its adverse impacts.”

It’s pretty obviously bad for any Democrat to oppose high taxes on the rich, labor unions, strong regulation, and production of public goods. So the Obama forces indeed are going to separate themselves from free trade and its well-documented benefits.

Bad news for America. Oh, for the days of Roosevelt, Truman, Kennedy, even Bill Clinton and his Treasury Secretary Summers.